Supply Side Hysterisis: The Case of the Canadian Unemployment Insurance System / Thomas Lemieux, W. Bentley MacLeod.

Format:

Book

Author/Creator:

Lemieux, Thomas.

Contributor:

National Bureau of Economic Research.

MacLeod, W. Bentley.

Series:

Working Paper Series (National Bureau of Economic Research) no. w6732.

NBER working paper series no. w6732

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Supply Side Hysterisis

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1998.

Summary:

This paper presents results from a 1971 natural experiment carried out by the Canadian government on the unemployment insurance system. At that time, they dramatically increased the generosity of the system. We find that the propensity to collect UI increases with a first time exposure to the system. Hence as more individuals experience unemployment their lifetime use of the system increases. This supply side hysterisis effect may explain why unemployment has steadily increased over the 1972 - 1992 period, even though the generosity of unemployment insurance did not.

Notes:

Print version record

September 1998.